HKUST Business School Magazine

References 1. Eloundou, T., S. Manning, P. Mishkin, and D. Rock. 2024. GPTs are GPTs: An early look at the labor market impact potential of large language models. Science 384 (6702), pp. 1306-1308. 2. Law, K. K. F., and M. Shen. 2024. How does artificial intelligence shape audit firms? Management Science, Forthcoming. 3. Fedyk, A., J. Hodson, N. Khimich, and T. Fedyk. 2022. Is artificial intelligence improving the audit process? Review of Accounting Studies 27 (3):938-985. 4. Fan Zhou, Zengzhi Wang, Qian Liu, Junlong Li, PengFei Liu. 2024. Programming Every Example: Lifting Pre- training Data Quality Like Experts at Scale, Working Paper, Available from https://arxiv.org/abs/2409.17115. 5. Bloomberg, “Citi used generative AI to read 1,089 pages of new capital rules”, Oct 2023. 6. Liang, P. J., A. Wang, L. Akoglu, and C. Faloutsos. 2021. Pattern recognition and anomaly detection in bookkeeping data. Working paper. Asian Bureau of Finance and Economic Research (ABFER). Available from https://www.abfer.org/component/edocman/main-annual-conference/pattern-recognition-and-anomaly- detection-in-bookkeeping-data. 7. Bao, Y., Bin. Ke, Bin. Li, Y. J. Yu, and Jie Zhang. 2020. Detecting accounting fraud in publicly traded U.S. Firms using a machine learning approach. Journal of Accounting Research 58 (1):199-235. 8. Bertomeu, J., E. Cheynel, E. Floyd, and W. Pan. 2021. Using machine learning to detect misstatements. Review of Accounting Studies 26 (2):468-519. 9. Jiang, L., M. Vasarhelyi, and C. A. Zhang. 2022. Towards real-time financial statement fraud detection using machine learning. Working paper. Rutgers University. Available from https://ssrn.com/abstract =4003621. 10. Commerford, B. P., S. A. Dennis, J. R. Joe, and J. W. Ulla. 2022. Man versus machine: Complex estimates and auditor reliance on artificial intelligence. Journal of Accounting Research 60 (1):171-201. 11. Austin, A. A., T. D. Carpenter, M. H. Christ, and C. S. Nielson. 2021. The data analytics journey: Interactions among auditors, managers, regulation, and technology. Contemporary Accounting Research 38 (3):1888-1924. 12. Cao, T., R.-R. Duh, H.-T. Tan, and T. Xu. 2022. Enhancing auditors' reliance on data analytics under inspection risk using fixed and growth mindsets. The Accounting Review 97 (3):131-153. 13. Eulerich, M., A. Sanatizadeh, H. Vakilzadeh, and D. A. Wood. 2024. Is it all hype? Chatgpt’s performance and disruptive potential in the accounting and auditing industries. Review of Accounting Studies 29 (3):2318-2349. 14. Deloitte, Research from Deloitte CFO Signals Q1 2024 15. World Economic Forum, Future of Jobs Report, May 2023 How should accountants and auditors reskill and upskill? Firstly, embrace change and confront challenges by exploring the accounting and auditing fields with generative AI tools. As an accountant or auditor, it’s essential to learn how to use these tools correctly and effectively, including self-assessing your proficiency level in prompt engineering and optimizing your prompts based on best practices. This may pose a greater challenge for older workers compared to their younger counterparts. Secondly, beyond mastering the tools, accountants and auditors should evaluate which tasks in their profession are suitable for generative AI assistance. This process involves recognizing the technology’s limitations, understanding potential risks, critically selecting appropriate use cases, and ensuring human review supplements AI outputs. Professionals should shift their focus from “how to do” expertise to “how to do it better and faster with Gen AI tools”, fostering better human-AI alignment. Finally, the accounting and auditing professions must collectively address the issue of knowledge retention. As generative AI develops, some decision-making will inevitably be delegated to AI. However, it’s crucial to identify the knowledge that auditors and accountants must retain to avoid over-reliance on AI and to maintain sound judgment. Determining which expertise can be entrusted to AI with minimal human intervention is a thought-provoking exercise that leaders in the auditing and accounting fields should actively pursue. What kinds of skills do accountants and auditors need? In the era of Gen AI, a new workforce design principle has emerged, known as Workforce Intelligence (Wi). This concept refers to the seamless integration of Human Intelligence (Hi) and Artificial Intelligence (Ai). This workforce design is primarily focused on reallocating professionals’ time, resulting in a shift in individual value. Tasks such as information gathering and initial idea formulation are now managed by generative AI, allowing professionals to concentrate on enhancing their skills in insight generation and professional judgment. This trend is undoubtedly the future for accountants and auditors. According to the World Economic Forum’s Report, a survey on the skills expected to increase or decrease in importance over the next five years highlights evolving business expectations regarding worker skills. 15 Cognitive skills are reported to be rising most rapidly, emphasizing the growing need for complex problem-solving in the workplace. Creative thinking is anticipated to gain importance slightly faster than analytical thinking, with technology literacy emerging as the third-fastest growing core skill. Biz@HKUST 41